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Algeria plans to raise its government expenditure in 2015 by 15.9% to AD8,877bn ($111bn), according to the draft budget which was approved by the cabinet at the end of August. With a steady exchange rate of $1=AD80 and inflation of around 3% this represents an increase of over 12% even in real terms.
The draft budget projects an overall GDP growth rate of 3% (4.2% for non-oil GDP) in 2015, despite continued lackluster growth in the EU, a cabinet statement says.
Growth will be driven by government spending, which will see the investment budget rise by 33% to AD3,908bn ($48.9bn). The latter includes an allocation of AD1,600bn ($20bn) for ongoing projects, AD1,100bn ($13.8bn) for new projects in the sectors of housing, health, education, water, energy and training, as well as AD700bn ($8.8bn ) for the “state’s economic action” program. GDP growth for 2014 is expected to come at around 4.5%. (CONTINUED - 750 WORDS)